I looked in my aircraft handbook and typically you drill the holes for rivets larger (~2-5 thou) than the diameter of the rivet... so that doesn't account for why the holes are 0.032" larger. If the original rivets weren't installed correctly at the factory or if the panel was ever replaced, the rivets would have been drilled out. If the holes had grown as a result (or someone used a 1/4" drill instead of a 7/32" drill) and 7/32" rivets weren't snugly fitting within the holes, the next size up of rivet (1/4") would have been used. It's also possible that as 7/32" is (to me at least) a weird diameter of rivet, MCI just went with the much more common 1/4" diameter rivets. 1/4" rivets are probably going to be fine to use given that's what was in there originally; if 1/4" rivets are fitting loosely in the holes you might want to go to the next size up (5/16").

(Full disclaimer - I don't know the history of your bus, I'm not a mechanic (or, though I have a degree in mechanical engineering, a P.Eng), and I'm following what I've read for riveting on aircraft)